💰 Financial Performance

Revenue Growth by Segment

The private market segment grew 25% YoY in H1FY26, demonstrating resilience. However, the government segment (B2G) saw a temporary dip as 4 major tenders were deferred to H2, leading to a total revenue decline of 5.37% YoY to INR 22.28 Cr.

Geographic Revenue Split

Revenue is highly concentrated in Uttar Pradesh (77.5%), followed by Delhi (15.5%), Maharashtra (2.4%), and Gujarat (2.2%). Exports contributed INR 34.10 Lakhs in FY25 across 4 countries.

Profitability Margins

PAT margin declined from 14.04% in H1FY25 to 8.32% in H1FY26. Gross margins remain healthy at 40-45% for the private segment and 29-32% for the government segment.

EBITDA Margin

EBITDA margin fell to 14.17% in H1FY26 from 21.31% in H1FY25, a 33.50% YoY decline. This was driven by fixed operational costs and expansion investments (manpower and premises) against lower H1 revenue.

Capital Expenditure

The company invested in a new 4,500 Sq. Ft. manufacturing facility in Noida and expanded its Shop-in-Shop (SIS) network to 49 clinics. Specific INR Cr capex for the period was not disclosed.

Credit Rating & Borrowing

Short-term borrowings stood at INR 5.61 Cr as of September 30, 2025. Interest costs increased 104.18% YoY to INR 38.61 Lakhs, with an interest coverage ratio of 7.59.

⚙️ Operational Drivers

Raw Materials

Electronic components for hearing aids and diagnostic devices; specific material names like 'silicon' or 'copper' were not disclosed.

Key Suppliers

Not disclosed; however, OMNI Audiometer manufacturing is currently outsourced to third-party partners.

Capacity Expansion

Current facility is 4,500 Sq. Ft. in Noida. The company aims to scale its Shop-in-Shop (SIS) network to 500+ clinics to drive future volume.

Raw Material Costs

Total expenditure was INR 19.15 Cr in H1FY26, up 2.99% YoY. Trading revenue accounts for less than 10% of total revenue, indicating a high focus on in-house manufacturing value-add.

Manufacturing Efficiency

The company expects to reach 70-80% operational efficiency within 12-19 months as new hires and infrastructure scale up.

Logistics & Distribution

Distribution is handled through a multi-channel network including online, government GeM portal, defense/armed forces, and a retail dealer base.

📈 Strategic Growth

Expected Growth Rate

25%

Growth Strategy

Growth will be driven by the execution of deferred government orders (INR 9 Cr already secured for H2), expansion of the SIS clinic model to 500+ locations, and scaling the proprietary OMNI Audiometer platform to ENT practices.

Products & Services

Hearing aids (brands: EQFY, Fame, Radius), OMNI Audiometer diagnostic devices, and audiology services (diagnostic tests, franchise fees).

Brand Portfolio

EQFY, Fame, Radius

New Products/Services

Launched a new patent for 'Smart Sound Treatment and Diagnosis System' and the OMNI Audiometer, which enables remote diagnostics.

Market Expansion

Targeting Tier 2 and 3 cities in India and exploring global opportunities in North America following strong interest at US exhibitions.

Market Share & Ranking

Not disclosed; company competes with major global MNC players in the hearing aid industry.

Strategic Alliances

Partnerships with ENT doctors for the Shop-in-Shop (SIS) model, utilizing 6x6 sq ft areas within existing practices.

🌍 External Factors

Industry Trends

The global hearing aid market is growing at a 6.6% CAGR, projected to reach $12.67B by 2030, driven by technological advancements like remote audiometry.

Competitive Landscape

Competes with large global MNCs that have significantly higher R&D budgets; Earkart positions itself as an affordable, tech-driven alternative for the Indian market.

Competitive Moat

Moat is built on proprietary technology (OMNI Audiometer), a unique low-capex SIS distribution model, and a new patent for sound treatment, providing a cost and access advantage over MNCs.

Macro Economic Sensitivity

Highly sensitive to the aging population demographic; 66.5% of the 430M people needing hearing rehab globally are aged 60+.

Consumer Behavior

Increasing adoption of hearing technology in Tier 2/3 cities and a shift toward private healthcare providers over government-supplied aids.

Geopolitical Risks

Potential trade barriers for electronic components; company is exploring North American expansion which introduces international regulatory risks.

⚖️ Regulatory & Governance

Industry Regulations

Operations are governed by CDSCO (Class A & B medical devices), BIS (Bureau of Indian Standards), and ISO 13485:2016 certifications.

Taxation Policy Impact

Effective tax rate was approximately 27.2% in H1FY26 (INR 69.23 Lakhs tax on INR 254.56 Lakhs PBT).

Legal Contingencies

No pending court cases or major legal disputes were disclosed in the provided documents.

⚠️ Risk Analysis

Key Uncertainties

Timing of government tender openings remains the primary uncertainty, causing potential 30-40% fluctuations in EBITDA as seen in H1FY26.

Geographic Concentration Risk

High concentration in Uttar Pradesh (77.5% of revenue) leaves the company vulnerable to regional economic or policy shifts.

Third Party Dependencies

Dependency on outsourced manufacturing for the OMNI Audiometer platform.

Technology Obsolescence Risk

Risk of being outpaced by MNC R&D; mitigated by acting as a tech platform that also aggregates third-party hearing aids.

Credit & Counterparty Risk

Trade receivables stood at INR 22.10 Cr as of September 2025, representing nearly 100% of H1 revenue, indicating high working capital intensity.